GENERAL ASSEMBLY OF NORTH CAROLINASESSION 2011H DHOUSE DRH60154-MNz-4A* (03/23)
Short Title: Amend UCC Article 9/Secured Transactions. (Public)Sponsors: Representatives Blust and Ross (Primary Sponsors).Referred to:
*DRH60154-MNz-4A*
H.B. 1068
May 22, 2012
HOUSE PRINCIPAL CLERK
A BILL TO BE ENTITLED1AN ACT TO AMEND ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE RELATING2TO SECURED TRANSACTIONS, AS RECOMMENDED BY THE GENERAL3STATUTES COMMISSION.4The General Assembly of North Carolina enacts:5
PART I. 2010 UCC ARTICLE 9 AMENDMENTS.
6
SECTION 1.
G.S. 25-9-102(a) reads as rewritten:7"
§ 25-9-102. Definitions and index of definitions.
8(a) Article 9 definitions.
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In this Article:9
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10(7) "Authenticate" means:11a. To sign; or12b. To execute or otherwise adopt a symbol, or encrypt or similarly13process a record in whole or in part, with the present intent of the14authenticating person to identify the person and adopt or accept a15record.With present intent to adopt or accept a record, to attach to or16logically associate with the record an electronic sound, symbol, or17process.18
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19(10) "Certificate of title" means a certificate of title with respect to which a20statute provides for the security interest in question to be indicated on the21certificate as a condition or result of the security interest's obtaining priority22over the rights of a lien creditor with respect to the collateral. The term23includes another record maintained as an alternative to a certificate of title24by the governmental unit that issues certificates of title if a statute permits25the security interest in question to be indicated on the record as a condition26or result of the security interest's obtaining priority over the rights of a lien27creditor with respect to the collateral.28
…
29(50) "Jurisdiction of organization", with respect to a registered organization,30means the jurisdiction under whose law the organization is formed or31organized.32
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33(70a) "Public organic record" means a record that is available to the public for34inspection and is:35
General Assembly of North Carolina Session 2011
Page 2 H1068 [Filed]a. A record consisting of the record initially filed with or issued by a1state or the United States to form or organize an organization and any2record filed with or issued by the state or the United States which3amends or restates the initial record;4b. An organic record of a business trust consisting of the record initially5filed with a state and any record filed with the state which amends or6restates the initial record, if a statute of the state governing business7trusts requires that the record be filed with the state; or8c. A record consisting of legislation enacted by the legislature of a state9or the Congress of the United States which forms or organizes an10organization, any record amending the legislation, and any record11filed with or issued by the state or the United States which amends or12restates the name of the organization.13
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14(73) "Registered organization" means an organization formed or organized solely15under the law of a single state or the United States and as to which the state16or the United States must maintain a public record showing the organization17to have been organized.by the filing of a public organic record with, the18issuance of a public organic record by, or the enactment of legislation by the19state or the United States. The term includes a business trust that is formed20or organized under the law of a single state if a statute of the state governing21business trusts requires that the business trust's organic record be filed with22the state.23
…
."24
SECTION 2.
G.S. 25-9-105 reads as rewritten:25"
§ 25-9-105. Control of electronic chattel paper.
26(a) General Rule: Control of Electronic Chattel Paper.
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A secured party has control of 27electronic chattel paper if a system employed for evidencing the transfer of interests in the28chattel paper reliably establishes the secured party as the person to which the chattel paper was29assigned.30(b) Specific Facts Giving Control.
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A system satisfies subsection (a) of this section if 31the record or records comprising the chattel paper are created, stored, and assigned in such a32manner that:33(1) A single authoritative copy of the record or records exists which is unique,34identifiable identifiable, and, except as otherwise provided in subdivisions35(4), (5), and (6) of this section, unalterable;36(2) The authoritative copy identifies the secured party as the assignee of the37record or records;38(3) The authoritative copy is communicated to and maintained by the secured39party or its designated custodian;40(4) Copies or revisions amendments that add or change an identified assignee of 41the authoritative copy can be made only with the participation consent of the42secured party;43(5) Each copy of the authoritative copy and any copy of a copy is readily44identifiable as a copy that is not the authoritative copy; and45(6) Any revision amendment of the authoritative copy is readily identifiable as46an authorized or unauthorized revision.authorized or unauthorized."47
SECTION 3.
G.S. 25-9-307(f) reads as rewritten:48"(f) Location of registered organization organized under federal law; bank branches and49agencies.
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Except as otherwise provided in subsection (i) of this section, a registered50
General Assembly of North Carolina Session 2011
H1068 [Filed] Page 3organization that is organized under the law of the United States and a branch or agency of a1bank that is not organized under the law of the United States or a state are located:2(1) In the state that the law of the United States designates, if the law designates3a state of location;4(2) In the state that the registered organization, branch, or agency designates, if 5the law of the United States authorizes the registered organization, branch,6or agency to designate its state of location; location, including by7designating its main office, home office, or other comparable office; or8(3) In the District of Columbia, if neither subdivision (1) nor subdivision (2) of 9this subsection applies."10
SECTION 4.
G.S. 25-9-311(a) reads as rewritten:11"(a) Security interest subject to other law.
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Except as otherwise provided in subsection12(d) of this section, the filing of a financing statement is not necessary or effective to perfect a13security interest in property subject to:14(1) A statute, regulation, or treaty of the United States whose requirements for a15security interest's obtaining priority over the rights of a lien creditor with16respect to the property preempt G.S. 25-9-310(a);17(2) A certificate-of-title statute of this State covering automobiles or other goods18that provides for a security interest to be indicated on the a certificate of title19as a condition to or result of perfection of the security interest, including20G.S. 20-58 and G.S. 75A-41; or21(3) A certificate-of-title statute of another jurisdiction which provides for a22security interest to be indicated on the a certificate of title as a condition or23result of the security interest's obtaining priority over the rights of a lien24creditor with respect to the property."25
SECTION 5.(a)
The catch line of G.S. 25-9-316 reads as rewritten:26"
§ 25-9-316. Continued perfection of security interest followingEffect of change in
27
governing law.
"
28
SECTION 5.(b)
G.S. 25-9-316 is amended by adding two new subsections to read:29"(h) Effect on Filed Financing Statement of Change in Governing Law.
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The following30rules apply to collateral to which a security interest attaches within four months after the debtor31changes its location to another jurisdiction:32(1) A financing statement filed before the change pursuant to the law of the33 jurisdiction designated in G.S. 25-9-301(1) or G.S. 25-9-305(c) is effective34to perfect a security interest in the collateral if the financing statement would35have been effective to perfect a security interest in the collateral had the36debtor not changed its location.37(2) If a security interest perfected by a financing statement that is effective38under subdivision (1) of this subsection becomes perfected under the law of 39the other jurisdiction before the earlier of the time the financing statement40would have become ineffective under the law of the jurisdiction designated41in G.S. 25-9-301(1) or G.S. 25-9-305(c) or the expiration of the four-month42period, it remains perfected thereafter. If the security interest does not43become perfected under the law of the other jurisdiction before the earlier44time or event, it becomes unperfected and is deemed never to have been45perfected as against a purchaser of the collateral for value.46(i) Effect of Change in Governing Law on Financing Statement Filed Against Original47Debtor.
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If a financing statement naming an original debtor is filed pursuant to the law of the48 jurisdiction designated in G.S. 25-9-301(1) or G.S. 25-9-305(c) and the new debtor is located in49another jurisdiction, the following rules apply:50
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